Jasmeet Khurana, Associate Director Consulting said: "The Maharashtra bid goes to show that new investor interest exists even at current tariff levels. UK based Lightsource and China based Canadian Solar are known to have been looking at opportunities in India. They have finally taken a plunge. Due to a big swell in new allocations over the past 6-8 months, many of the prominent developers are reaching investment and operational limits. This should open up avenues for new developers and investors waiting on the sidelines."

This was under Part-B of the National Solar Mission Phase-II which Solar Energy Corporation of India (SECI) is implementing along with a large number of schemes under the National Solar Mission (JNNSM) including this one in Maharashtra.

This projects are also eligible for viability gap funding (VGF) although the lowest bid of Rs 4.42 did not ask for any such funding while the rest opted for viability funding of Rs 1.46 lakh per megawatt on the lower side to Rs 2.48 lakh megawatt on the higher side. VGF support is a Government Grant that is provided by SECI upon successful commissioning of the plant.

Under these schemes, solar power projects are set up by private developers on Build-Own-Operate (BOO) basis, either in government designated solar power parks or in any other location of the developer's choice. Power purchase agreements (PPA) are signed with SECI for 25 years.

However, Khurnana said that the underlying off-taker in the case of this bid (Maharashtra) is more bankable that some of the other SECI bids (in other states) and that does have an impact on risk perception and tariffs.

"This is aided by a rapid reduction in equipment costs due to the ongoing global supply glut. Maharashtra has the highest power consumption amongst all states in the country but it lags far behind many states in terms of adoption of solar power. The state will need to play an important role in future growth of the utility scale solar market in the country," he said.